If I thought Barack Obama could do as much damage to Syria as he’s done to the American economy, I’d be less nervous about his rush to war. The unemployment rate ticked down to 7.3 percent… but in a familiar story throughout the Obama years, it’s almost entirely due to people giving up and dropping out of the workforce completely. Over 312,000 of them, in fact. In a single month. It’s like a county or two dropping off the map of the American economy every month Obama has been in office. According to CNBC, we’ve hit a 35-year-low in the workforce participation rate.
Not only was the anemic 169k job creation for August weaker than anticipated, but the already weak July report was revised downward to 172k jobs created… and June took an astonishing plunge from 162k jobs to just 104k. Take those three months together – remember, the Administration invariably tells us not to read too much into one job report, unless it’s a freak accident that makes Obama look good – and you’ve got a pronounced slowdown in job creation since last year.
This job market is in free fall as ObamaCare looms. The endless pronouncements of growth “just around the corner” from Administration flacks ring as hollow as the assurances of Monty Python’s parrot salesman that the deceased Norwegian Blue is just pining for the fjords.
Some more gloomy internals from CNBC:
Unemployment for blacks jumped to 13.0 percent from 12.6 percent, while the average duration of unemployment hit a five-month high at 37 weeks.
And job quality was at the low end of the income spectrum, as retail led the way with 44,000. Health care was next with 33,000, professional and business services gained 23,000 and bars and restaurants added 21,000.
They forgot to mention the 13,000 temporary jobs added last month. Add those crappy jobs together, and you get almost all of the new job creation for August. (That gloomy observation comes from ZeroHedge, a persistent critic of the Bureau of Labor Statistics. They noticed a mighty fishy discrepancy between the reported unemployment rate for this month, and the number you get if job creation is combined with workforce decline, leading them to accuse the BLS of fudging the data to hide an even more hideous unemployment reality. In fact, ZeroHedge thinks last month was the biggest load of unemployment fudge in U.S. history.)
On the bright side, according to CNBC, “the average work week increased 0.1 percent to 34.5 hours and the average wage rose 5 cents to $24.05.” That would suggest a pause in the headlong rush to convert full-time jobs into part-time work. Or maybe it’s because even the entry-level retail and restaurant jobs aren’t hiring as many people. Summer jobs are coming to an end. Generation Opportunity offers the following unemployment statistics for young people:
The (U3) unemployment rate for 18-29 year olds is 11.8 percent (NSA).
The (U3) unemployment rate for 18-29 year old African-Americans is 21.6 percent (NSA).
The (U3) unemployment rate for 18-29 year old Hispanics is 12.8 percent (NSA)
The (U3) unemployment rate for 18???29 year old women is 10.8 percent (NSA).
“As the summer draws to a close, young people are no better off than we were three months ago,” said Generation Opportunity president Evan Feinberg. “Practically all of the jobs created this summer were part-time, and precious few even went to young people. Worse, the looming threat of Obamacare offers employers little incentive to transition any of those jobs into full-time positions.”
In a healthy economy, a vibrant entry-level job market (yes, including those awful minimum-wage burger-flipper jobs) draws people into the workforce and feeds them higher up the salary chain. CNBC quotes Sue Marks of global employment firm Pinstripe remarking, “We’ve got a generational shift going on here. It’s going to be persistent.” That sounds ominous, especially if the “generational shift” she’s talking about involves inexperienced young people losing a desperate struggle to snag a dwindling pool of entry-level jobs from older workers who could do better, in a more robust job market. That’s going to become an even more pronounced problem at the second tier above entry-level work, which should be where employers take a gamble on promising young people who distinguish themselves at low-wage entry positions, but will become the last refuge of experienced workers desperate to hold on to full-time hours.
According to this month’s labor report, new weekly jobless claims are holding below 350,000, so what we’ve got is dead-in-the-water stagnation… with the input system for tomorrow’s workforce disabled, and huge masses of people dropping out of the game completely. A lot of them are never coming back, particularly those who go on long-term disability.